Freezing orders – Order 37A Flashcards
How is an application for a freezing order made?
By way of an OM
What is a freezing order?
A freezing order is an order of the Court prohibiting a person from dealing with assets (in either a specific or general way). A freezing order may be made to restrain a respondent from removing any assets located in or outside Australia or from disposing of, dealing with, or diminishing the value of, those assets (r 37A.02).
When would a court make a freezing order?
R 37A.02 provides that the Court may make an order a freezing order:
* upon or without notice to the respondent,
* for the purpose of preventing the frustration or inhibition of the Court’s process
* by seeking to meet a danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied.
What should the applicant establish in an application for a freezing order?
An application for freezing order is made under r 37A.02 and/or in the inherent jurisdiction of the Court and may be granted where the applicant establishes (in an affidavit) the matters in r 37A.02(5), r 37A.05 as well as (Zhen v Mo [2008]):
- an arguable case and the value of the prospective judgment with some precision;
- a danger that the respondent will remove the assets, deal with them or diminish their value; and,
- that the balance of convenience favours the granting of the freezing order.
When can a freezing order be made against a third party?
An Order may be made against third parties who are not respondents in proceedings (r 37A.04) e.g. banks.
What is the test for granting freezing order appliations?
The balance of convenience is the weighing of the prejudice or loss that a party would suffer from the granting or non-granting of the order, if that decision turned out to have been wrong.
How common are freezing orders?
A freezing order should be viewed as an extraordinary interim remedy because it can restrict the right to deal with assets, even before judgment, and is commonly granted without notice
costs and freezing orders
The Court may make any orders as to costs as it considers appropriate in relation to an order made under this Order.
What should be included in an affidavit in support of a freezing order application?
Affidavits must address (r 37A.02(5)):
– The nature of the judgment and if there is none, the basis for the claim the amount, and whether (if ex parte application) there is a possible defence;
– Nature of respondent’s assets;
– The identity of anyone other than respondent who might be affected;
Other matters provided for in r 37A.05
Is there a notice requirement for freezing orders?
NO
Notice is not required: r 37A.02(1)
What are the service requirements for a freezing order?
Rule 37A.07 sets out the service requirements for freezing orders:
- Applications may be served on persons outside Australia if any asset to which the order relates is within the court’s jurisdiction
- Freezing orders must be authenticated, and when served, be served together with a copy of
o The summons/OM or if there was none, the draft summons/OM
o Material relied on by the applicant at the hearing
o A transcript of the hearing or notes
